[Federal Register Volume 77, Number 142 (Tuesday, July 24, 2012)]
[Notices]
[Pages 43329-43334]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-17952]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-2385-N]
RIN 0938-AR47


Medicaid Program; State Allotments for Payment of Medicare Part B 
Premiums for Qualifying Individuals (QIs) for FY 2012

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Notice.

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SUMMARY: This notice sets forth the States' final allotments available 
to pay the Medicare Part B premiums for Qualifying Individuals (QIs) 
for the Federal fiscal year (FY) 2011 and the preliminary QI allotments 
for FY 2012. The amounts of these QI allotments were determined in 
accordance with the methodology set forth in regulations and reflect 
funding for the QI program made available under recent legislation as 
described in this notice.

DATES: The final QI allotments for payment of Medicare Part B premiums 
for FY 2011 are effective October 1, 2010. The preliminary QI 
allotments for FY 2012 are effective October 1, 2011.

FOR FURTHER INFORMATION CONTACT: Richard Strauss, (410) 786-2019.

SUPPLEMENTARY INFORMATION:

I. Background

A. QI Allotments for FY 2011 and Thereafter

    Section 5005 of the American Recovery and Reinvestment Act of 2009 
(Pub. L. 111-5, enacted on February 17, 2009) (Recovery Act) extended 
the authority and funding for the QI program by providing $150 million 
in additional funds for the first quarter of FY 2011 (that is, through 
December 31, 2010). Section 3 of the Emergency Aid to American 
Survivors of the Haiti Earthquake Act (Pub. L. 111-127, enacted on 
January 27, 2010) (Haiti Earthquake Act) provided an additional $15 
million for States' FY 2011 QI allotments; that brought the total funds 
available for the QI program for FY 2011 through December 31, 2010 to 
$165 million. Section 110 of the Medicare and Medicaid Extenders Act of 
2010 (Pub. L. 111-309, enacted on December 15, 2010) (MMEA) extended 
authority and funding for the QI program for FY 2011 by providing an 
additional $720 million for the QI program for the last 3 quarters of 
FY 2011 in addition to the previously available $165 million; which 
brought the total funding available for the QI program for FY 2011 to 
$885 million.

B. QI Allotments for FY 2012 and Thereafter

    Section 110 of the MMEA also extended the authority and funding for 
the QI program for the first quarter of FY 2012 (that is, through 
December 31, 2011) by providing $280 million available for the first 
quarter of FY 2012. Section 310 of the Temporary Payroll Tax Cut 
Continuation Act of 2011 (Pub. L. 112-78, enacted on December 23, 2011) 
(TPTCA) provided temporary continued authority and an additional $150 
million in funding for the QI program for the period January 1, 2012 
through February 29, 2012. With the enactment of TPTCA, the QI program 
was authorized and funded at a total amount nationally of $430 million 
($280 million plus $150 million) for FY 2012 through February 29, 2012. 
Most recently, section 3101 of the Middle Class Tax Relief and Job 
Creation Act of 2012 (Pub. L. 112-96, enacted on February 22, 2012) 
extended the authority and funding for the QI program for FY 2012 by 
increasing the amount of funding previously made available under TPTCA 
for FY 2012 from $150 million to $450 million, and extending the period 
in FY 2012 this funding is available to September 30, 2012 (that is, to 
the end of FY 2012). Therefore the total funding available for the QI 
program for FY 2012 is $730 million ($280 million plus $450 million).
    Finally, section 3101 of Middle Class Tax Relief and Job Creation 
Act also extended the authority and funding for the QI program by 
providing $280 million to be available for the period October 1, 2012 
through December 31, 2012, the first quarter of FY 2013.

C. Methodology for Calculating the Fiscal Year QI Allotments

    The amounts of the final FY 2011 and preliminary FY 2012 QI 
allotments, contained in this notice, were determined in accordance 
with the methodology set forth in existing regulations at 42 CFR 
433.10(c)(5) and reflect funding for the QI program made available 
under the legislation discussed above.

II. Charts

    The final QI allotments for FY 2011 and the preliminary QI 
allotments for FY 2011 are shown by State in Chart 1 and Chart 2 below, 
respectively:
    Chart 1--Final Qualifying Individuals Allotments for October 1, 
2010 through September 30, 2011.
    Chart 2--Preliminary Qualifying Individuals Allotments for October 
1, 2011 through September 30, 2012.
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    The following describes the information contained in the columns of 
Chart 1 and Chart 2:
    Column A--State. Column A shows the name of each State. Columns B 
through D show the determination of an Initial QI Allotment for FY 2011 
(Chart 1) or FY 2012 (Chart 2) for each State, based only on the 
indicated Census Bureau data.
    Column B--Number of Individuals. Column B contains the estimated 
average number of Medicare beneficiaries for each State that are not 
covered by Medicaid whose family income is at least 120 but less than 
135 percent of the federal poverty level. With respect to the final FY 
2011 QI allotment (Chart 1), Column B contains the number of such 
individuals for the years 2007 through 2009, as obtained from the 
Census Bureau's Annual Social and Economic Supplement to the 2010 
Current Population Survey. With respect to the preliminary FY 2012 QI 
allotment (Chart 2), Column B contains the number of such individuals 
for the years 2008 through 2010, as obtained from the Census Bureau's 
Annual Social and Economic Supplement to the 2011 Current Population 
Survey.
    Column C--Percentage of Total. Column C provides the percentage of 
the total number of individuals for each State, that is, the Number of 
Individuals for the State in Column B divided by the sum total of the 
Number of Individuals for all States in Column B.
    Column D--Initial QI Allotment. Column D contains each State's 
Initial QI Allotment for FY 2011 (Chart 1) or FY 2012 (Chart 2), 
calculated as the State's Percentage of Total in Column C multiplied by 
the total amount available nationally for QI allotments for the fiscal 
year. The total amount available nationally for QI allotments each 
fiscal year is $885,000,000 for FY 2011 (Chart 1) and $730,000,000 for 
FY 2012 (Chart 2).
    Columns E through L show the determination of the States' Final QI 
Allotments for FY 2011 (Chart 1) or Preliminary QI Allotments for FY 
2012 (Chart 2).
    Column E--FY 2011 Estimated QI Expenditures. Column E contains the 
States' estimates of their total QI expenditures for FY 2011 (Chart 1) 
or FY 2012 (Chart 2) based on information obtained from States in the 
summer of 2011. The projected QI expenditures for FY 2012 were updated 
in January 2012 to reflect the extended funding and authority for the 
QI program for FY 2012.
    Column F--Need (Difference). Column F contains the additional 
amount of QI allotment needed for those States whose estimated 
expenditures in Column E exceeded their Initial QI allotments in Column 
D for FY 2011 (Chart 1) or for FY 2012 (Chart 2) for such States, 
Column F shows the amount in Column E minus the amount in Column D. For 
other ``Non-Need'' States, Column F shows ``NA''.
    Column G--Percent of Total Need States. For States whose projected 
QI expenditures in Column E are greater than their initial QI allotment 
in Column D for FY 2011 (Chart 1) or FY 2012 (Chart 2), respectively, 
Column G shows the percentage of total need, determined as the amount 
for each Need State in Column F divided by the sum of the amounts for 
all States in Column F. For Non-Need States, the entry in Column G is 
``NA''.
    Column H--Reduction Pool for Non-Need States. Column H shows the 
amount of the pool of surplus QI allotments for FY 2011 (Chart 1) or FY 
2012 (Chart 2), respectively, for those States that project QI 
expenditures for the fiscal year that are less than the Initial QI 
allotment for the fiscal year (referred to as non-need States). For 
States whose estimates of QI expenditures for FY 2011 or FY 2012, 
respectively, in Column E are equal to or less than their Initial FY 
2011 or FY 2012 QI allotments in Column D for FY 2011 or FY 2012, 
Column H shows the amount in Column D minus the amount in Column E. For 
the States with a need, Column H shows ``Need''. The reduction pool of 
excess QI allotments is equal to the sum of the amounts in Column H.
    Column I--Percent of Total Non-Need States. For States whose 
projected QI expenditures in Column E are less than their Initial QI 
allotment in Column D for FY 2011 (Chart 1) or FY 2012 (Chart 2), 
Column I shows the percentage of the total reduction pool in Column H, 
determined as the amount for each Non-Need State in Column H divided by 
the sum of the amounts for all States in Column H. For Need States, the 
entry in Column I is ``Need''.
    Column J--Reduction Adjustment for Non-Need States. Column J shows 
the amount of adjustment needed to reduce the Initial QI allotments in 
Column D for FY 2011 (Chart 1) or FY 2012 (Chart 2) for Non-Need States 
in order to address the total need shown in Column F. The amount in 
Column J is determined as the percentage in column I for Non-Need 
States multiplied by the lesser of the total need in Column F (equal to 
the sum of Needs in Column F) or the total Reduction Pool in Column H 
(equal to the sum of the Non-Need amounts in Column H). For Need 
States, the entry in Column J is ``Need''.
    Column K--Increase Adjustment for Need States. Column K shows the 
amount of adjustment to increase the Initial QI Allotment in Column D 
for FY 2011 (Chart 1) or FY 2012 (Chart 2) for Need States in order to 
address the total need shown for the fiscal year in Column F. The 
amount in Column K is determined as the percentage in Column G for Need 
States multiplied by the lesser of the total need in Column F (equal to 
the sum of Needs in Column F) or the total Reduction Pool in Column H 
(equal to the sum of the Non-Need amounts in Column H). For Non-Need 
States, the entry in Column K is ``NA''.
    Column L--Final FY 2011 QI Allotment (Chart 1) or Preliminary FY 
2012 QI Allotment (Chart 2). Column L contains the Final QI Allotment 
for each State for FY 2011 (Chart 1) or the Preliminary QI Allotment 
for FY 2012 (Chart 2). For States that need additional QI allotment 
amounts for the fiscal year based on Estimated QI Expenditures in 
Column E as compared to their Initial QI allotments in Column D for the 
fiscal year (States with a projected need amount are shown in Column 
F), Column L is equal to the Initial QI allotment in Column D for FY 
2011 (Chart 1) or FY 2012 (Chart 2) plus the amount determined in 
Column K for Need States. For Non-Need States (States with a projected 
surplus in Column H), Column L is equal to the QI Allotment in Column D 
reduced by the Reduction Adjustment amount in Column J.

III. Waiver of Notice With Comment and 30-Day Delay in Effective Date

    We ordinarily publish a notice with comment in the Federal Register 
and invite public comment. The notice with comment includes a reference 
to the legal authority under which the notice is proposed, and the 
terms and substance of the notice with comment, or a description of the 
subjects and issues involved. This procedure can be waived, however, if 
an agency finds good cause that a notice-and-comment procedure is 
impracticable, unnecessary, or contrary to the public interest, and 
incorporates a statement of the finding and its reasons in the notice 
issued. In addition, we also normally provide a delay of 30 days in the 
effective date. However, if adherence to this procedure would be 
impractical, unnecessary, or contrary to public interest, we may waive 
the delay in the effective date in accordance with the Administrative 
Procedure Act (5 U.S.C. 551 et seq).
    We are publishing this notice without a comment period or delay in 
effective

[[Page 43334]]

date because of the need to notify individual States of the limitations 
on Federal funds for their Medicaid expenditures for payment of 
Medicare Part B premiums for qualifying individuals. Some States have 
experienced deficits in their current allotments that have caused them 
to consider denying benefits to eligible applicants, while other States 
project a surplus in their allotments. This notice adjusts the 
allocation of Federal funds, which will reduce the impact of States 
potentially denying coverage to eligible QIs when there is sufficient 
funding to cover all or some of these individuals. Because access to 
Medicare Part B coverage for QIs, who without this coverage would have 
difficulty paying for needed health care, is critically important, we 
believe that it is in the public interest to waive the usual notice and 
comment procedure which we undertake before making a notice final. 
Moreover, we are not making any changes to the process we use for 
allocating allotments. We are simply implementing a process already set 
forth in regulations. For these reasons, we also believe a notice and 
comment process would be unnecessary.
    Therefore, for the reasons discussed above, we find that good cause 
exists to dispense with the normal requirement that a notice cannot 
become effective any earlier than 30 days after its publication. States 
that will have access to additional funds for QIs need to know that 
these funds are available as soon as possible. While we believe the 
surplus States that will have diminished amounts available for this FY 
will have sufficient funds for enrolling all potential QIs in their 
States, they also need to know as soon as possible that a certain 
amount of their unused allocation will no longer be available to them 
for this FY.

IV. Collection of Information Requirements

    This notice does not impose any information collection or 
recordkeeping requirements. Consequently, it does not need Office of 
Management and Budget review under the authority of the Paperwork 
Reduction Act of 1995 (44 U.S.C. 3501 et seq.).

V. Regulatory Impact Statement

    We have examined the impact of this notice as required by Executive 
Order 12866 (September 1993, Regulatory Planning and Review), the 
Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), 
section 1102(b) of the Social Security Act (the Act), the Unfunded 
Mandates Reform Act of 1995 (Pub. L. 104-4), and Executive Order 13132 
on Federalism and the Congressional Review Act (5 U.S.C. 804(2)).
    Executive Order 12866 directs agencies to assess all costs and 
benefits of available regulatory alternatives and, if regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety 
effects, distributive impacts, and equity). A regulatory impact 
analysis (RIA) must be prepared for major rules with economically 
significant effects ($100 million or more in any one year). This notice 
does not reach the economic threshold and thus is not considered a 
major rule.
    The RFA requires agencies to analyze options for regulatory relief 
for small businesses. For purposes of the RFA, small entities include 
small businesses, nonprofit organizations, and small governmental 
jurisdictions. Most hospitals and most other providers and suppliers 
are small entities, either by nonprofit status or by having revenues of 
$7 million to $34.5 million in any one year. Individuals and States are 
not included in the definition of a small entity.
    This notice codifies our procedures for implementing provisions of 
the Balanced Budget Act of 1997 (Pub. L. 105-33, enacted on August 5, 
1997) to allocate, among the States, Federal funds to provide Medicaid 
payment for Medicare Part B premiums for low-income Medicare 
beneficiaries. The total amount of Federal funds available during a 
Federal fiscal year and the formula for determining individual State 
allotments are specified in the law. We have applied the statutory 
formula for the State allotments. Because the data specified in the law 
were not initially available, we used comparable data from the U.S. 
Census Bureau on the number of possible qualifying individuals in the 
States. This notice also permits, in a specific circumstance, 
reallocation of funds to enable enrollment of all eligible individuals 
to the extent of the available funding.
    We believe that the statutory provisions implemented in this notice 
will have a positive effect on States and individuals. Federal funding 
at the 100 percent matching rate is available for Medicare cost-sharing 
for Medicare Part B premium payments for qualifying individuals and, 
with the reallocation of the State allotments, a greater number of low-
income Medicare beneficiaries will be eligible to have their Medicare 
Part B premiums paid under Medicaid. The changes in allotments will not 
result in fewer individuals receiving the QI benefit in any State.
    Section 1102(b) of the Act requires us to prepare a regulatory 
impact analysis for any rule that may have a significant impact on the 
operations of a substantial number of small rural hospitals. The 
analysis must conform to the provisions of section 604 of the RFA. For 
purposes of section 1102(b) of the Act, we define a small rural 
hospital as a hospital that is located outside of a metropolitan 
statistical area and has fewer than 100 beds.
    We are not preparing analyses for either the RFA or section 1102(b) 
of the Act because we have determined and certify that this notice will 
not have a significant economic impact on a substantial number of small 
entities or a significant impact on the operations of a substantial 
number of small rural hospitals.
    Section 202 of the Unfunded Mandates Reform Act of 1995 (Pub. L. 
104-04, enacted on March 22, 1995), also requires that agencies assess 
anticipated costs and benefits before issuing any rule that may result 
in expenditure in any one year by State, local, or tribal governments, 
in the aggregate, or by the private sector, of $139 million. This 
notice will have no consequential effect on the governments mentioned 
or on the private sector.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a rule that imposes substantial 
direct requirement costs on State and local governments, preempts State 
law, or otherwise has federalism implications. Since this notice does 
not impose any costs on State or local governments, the requirements of 
E.O. 13132 are not applicable.
    In accordance with the provisions of Executive Order 12866, this 
notice was reviewed by the Office of Management and Budget.

(Catalog of Federal Domestic Assistance Program No. 93.778, Medical 
Assistance Program)

    Dated: May 14, 2012.
Marilyn Tavenner,
Acting Administrator, Centers for Medicare & Medicaid Services.
    Dated: June 8, 2012.
Kathleen Sebelius,
Secretary.
[FR Doc. 2012-17952 Filed 7-20-12; 11:15 am]
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